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Employment agencies and employment businesses

Employment businesses and employment agencies are different things:

• a business that arranges you temporary work with a ‘hiring company’ is legally known as an 'employment business'
• an ‘employment agency’ is a business that introduces job-seekers to employers (eg, a recruitment consultant)

In reality many businesses deal with both finding temporary work and permanent employment and the term ‘agency’ is used for employment agencies and employment businesses.

Your agency should confirm with you if it is acting to find you a job with an employer or temporary work. If you are unsure if you are an agency worker you should check who pays you, if you are paid by the agency then this makes you an agency worker.

Permanent recruitment through employment agencies

There are important differences between temporary agency workers, and people who have found a fixed-term or permanent job through an employment agency.

Companies often use an employment agency to find them suitable candidates for a vacancy, and then hire someone based on the candidates put forward by the agency. In this situation, your employment contract would be with the company that hires you, rather than the employment agency.

If you use employment agencies to find permanent or fixed-term work you are still protected under the rules that govern employment agencies. However not all of the rules will apply to your situation, for example the employment agency will not pay your salary.

When you are employed directly by a company you will have different employment rights as a permanent or fixed-term member of staff, than you would as an agency worker.

What is an agency worker?

As an agency worker you will either have a contract for service or a contract of employment with the agency who finds you work. This work is often called ‘temporary work’, 'temping' or ‘agency work’. The firm who hires you pays a fee to the agency, and the agency pays your wages. The agency has to pay you even if the hiring company has not paid the agency. Agencies cannot charge you for finding work (although there are some exceptions if you are looking for work in the entertainment or modelling industries).

There are several advantages to being an agency worker, you can:

• use it as a stepping stone to the job you want
• use it as a way of entering or re-entering the job market
• use it to work more flexibly to help balance domestic responsibilities
• move jobs easily and with little or no notice
• try out different kinds of work

Flexibility for both worker and employer is one of the features of agency work. As an agency worker you have the flexibility to take up and leave jobs at short notice. The hiring company also has the flexibility to finish temporary work without being liable for unfair dismissal or redundancy pay. You should check your contract with your agency as it may include a notice period you may be obliged to give.

• Employment contracts

If you have your own company

If you have your own company or work through a limited company and use an agency then you are still protected as an agency worker. You can choose to opt-out of some of these protections but must do this before you are introduced to a hiring company by your agency. The opt-out has to be given by both the limited company contractor and the person actually doing the work (eg, if the limited company contractor engages its own workers).

In most cases you will still be covered by the Agency Worker Regulations.

An agency cannot make their work-finding services or an offer of work conditional on you opting out of your rights.

Where to get help

The Pay and Work Rights Helpline can give you support or advice on your rights as an agency worker.

If you have a general enquiry about your employment rights as an agency worker or a complaint about the agency you can use their online enquiry or complaint form.

• Pay and Work Rights general enquiry form Opens new window

• Pay and Work Rights complaint form Opens new window